California launches criminal probe into Wells Fargo account scandal

WASHINGTON, Oct 19 (Reuters) - The California Attorney General's Office has launched a criminal investigation into Wells Fargo over allegations it opened millions of unauthorized customer accounts and credit cards, according to a seizure warrant seen by Reuters.

Attorney General Kamala Harris authorized a seizure warrant against the bank seeking customer records and other documents, saying there is probable cause to believe the bank committed felonies.

The probe marks the latest setback for the bank in a growing scandal that led to the abrupt retirement of its chief executive officer, compensation clawbacks, lost business and damage to its reputation.

A spokesman for Wells Fargo did not immediately comment on the investigation, and a spokeswoman for the California Department of Justice said she could not comment on the probe.

The bank's downward spiral kicked into high gear last month, when the U.S. Consumer Financial Protection Bureau and other regulators ordered Wells Fargo to pay $190 million in fines and restitution to settle civil charges that it had opened about 2 million bank accounts and credit cards that were potentially unauthorized by customers.

The CFPB said that high pressure sales tactics and financial incentives fueled the fraud, which was largely carried out by low-level branch employees.

(Reporting by Sarah N. Lynch; Editing by Chris Reese and Alan Crosby)

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Wells Fargo CEO John Stumpf

John Stumpf, President and CEO of Wells Fargo, participates in a panel at the 2015 Fortune Global Forum in San Francisco, California November 2, 2015. REUTERS/Elijah Nouvelage

Wells Fargo CEO John Stumpf speaks during a news conference for Wachovia employees at the Wachovia corporate headquarters in Charlotte, North Carolina, October 15, 2008. REUTERS/Chris Keane (UNITED STATES)

Wells Fargo CEO John Stumpf testifies before a Senate Banking Committee hearing on the firm's sales practices on Capitol Hill in Washington, U.S., September 20, 2016. REUTERS/Gary Cameron TPX IMAGES OF THE DAY

WASHINGTON, DC - SEPTEMBER 20: John Stumpf, chairman and CEO of the Wells Fargo & Company, prepares for testimony before the Senate Banking, Housing and Urban Affairs Committee September 20, 2016 in Washington, DC. The committee heard testimony on the topic of 'An Examination of Wells Fargo's Unauthorized Accounts and the Regulatory Response.' (Photo by Win McNamee/Getty Images)

John Stumpf, chairman, president and chief executive officer of Wells Fargo & Co., speaks at the Bloomberg Year Ahead: 2014 conference in Chicago, Illinois, U.S., on Wednesday, Nov. 20, 2013. Stumpf said he dislikes Federal Reserve monthly bond purchases at this point in the economic cycle and that the policy has hurt savers. Photographer: Daniel Acker/Bloomberg via Getty Images

NEW YORK, NY - APRIL 30: Wells Fargo CEO John Stumpf (L) speaks with Wall Street Journal Editor in Chief Gerry Baker on FOX Business Networks' 'Opening Bell With Maria Bartiromo' at FOX Studios on April 30, 2015 in New York City. (Photo by Monica Schipper/Getty Images)

John Stumpf, chairman, president and chief executive officer of Wells Fargo & Co., speaks during an interview in Washington, D.C., U.S., on Thursday, May 7, 2015. Wells Fargo, the fourth-biggest U.S. bank by assets and the nation's leading home lender, in March left Stumpf's pay unchanged at $19.3 million after the firm generated a bigger profit than any other U.S. bank for a second straight year. Photographer: Andrew Harrer/Bloomberg via Getty Images

John Stumpf, chairman, president and chief executive officer of Wells Fargo & Co., listens to a question during an interview in Washington, D.C., U.S., on Thursday, May 7, 2015. Wells Fargo, the fourth-biggest U.S. bank by assets and the nation's leading home lender, in March left Stumpf's pay unchanged at $19.3 million after the firm generated a bigger profit than any other U.S. bank for a second straight year. Photographer: Andrew Harrer/Bloomberg via Getty Images